IDEAS home Printed from https://ideas.repec.org/a/eco/journ1/2018-03-1.html
   My bibliography  Save this article

A Review of Determinants of Financial Inclusion

Author

Listed:
  • Sanderson Abel

    (Senior Economist at Bankers Association of Zimbabwe, Zimbabwe)

  • Learnmore Mutandwa

    (Lecturer at Midlands State University, Zimbabwe)

  • Pierre Le Roux

    (Nelson Mandela University, South Africa)

Abstract

The role of financial inclusion in the economic and financial discourse has gained a lot of interest both among academia and practitioners. The discussion has further received attention from development partners such as the World Bank, International Monetary Fund, G20 and AFDB among others. Taking cue from developments elsewhere Zimbabwean government commissioned the national financial inclusion strategy. The objective of the current study is to evaluate determinants of financial inclusion in Zimbabwe. The study established that age, education, financial literacy, income, and internet connectivity are positively related to financial inclusion. On the other hand the documentation required to open bank accounts and the distance to the nearest access point are negatively related to financial inclusion. The study recommends that the government should put in place policies that encourage financial service providers to set up their operations closer to the people or ensure they adopt technologies that ensure financial services are more accessible such as agency and mobile banking. The government should therefore encourage the use of KYC lite accounts to ease documentation requirements without compromising anti-money laundering framework which can destabilise the financial system.

Suggested Citation

  • Sanderson Abel & Learnmore Mutandwa & Pierre Le Roux, 2018. "A Review of Determinants of Financial Inclusion," International Journal of Economics and Financial Issues, Econjournals, vol. 8(3), pages 1-8.
    • Handle: RePEc:eco:journ1:2018-03-1
    as

    Download full text from publisher

    File URL: https://www.econjournals.com/index.php/ijefi/article/download/5458/pdf
    Download Restriction: no
    File URL: https://www.econjournals.com/index.php/ijefi/article/view/5458/pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Chang-Keun Han & Michael Sherraden, 2009. "Attitudes and Saving in Individual Development Accounts: Latent Class Analysis," Journal of Family and Economic Issues, Springer, vol. 30(3), pages 226-236, September.
    2. Peter Dittus & Michael Klein, 2011. "On harnessing the potential of financial inclusion," BIS Working Papers 347, Bank for International Settlements.
    3. Sami Ben Naceur & Adolfo Barajas & Alexander Massara, 2017. "Can Islamic banking increase financial inclusion?," Chapters, in: M. Kabir Hassan (ed.), Handbook of Empirical Research on Islam and Economic Life, chapter 9, pages 213-252, Edward Elgar Publishing.
    4. Ximena Pena & Carmen Hoyo & David Tuesta, 2014. "Determinantes de la inclusion financiera en Mexico a partir de la ENIF 2012," Working Papers 1414, BBVA Bank, Economic Research Department.
    5. Md. Nur Alam Siddik & Gang Sun & Sajal Kabiraj & Joghee Shanmugan & Cui Yanjuan, 2016. "Impacts of e-banking on performance of banks in a developing economy: empirical evidence from Bangladesh," Journal of Business Economics and Management, Taylor & Francis Journals, vol. 17(6), pages 1066-1080, November.
    6. Lusardi, Annamaria & Mitchell, Olivia S., 2007. "Baby Boomer retirement security: The roles of planning, financial literacy, and housing wealth," Journal of Monetary Economics, Elsevier, vol. 54(1), pages 205-224, January.
    7. Anthanasius F. Tita & Meshach J. Aziakpono, 2017. "The effect of financial inclusion on welfare in sub-Saharan Africa: Evidence from disaggregated data," Working Papers 679, Economic Research Southern Africa.
    8. Beck, Thorsten & de la Torre, Augusto, 2006. "The basic analytics of access to financial services," Policy Research Working Paper Series 4026, The World Bank.
    9. de Koker, Louis & Jentzsch, Nicola, 2013. "Financial Inclusion and Financial Integrity: Aligned Incentives?," World Development, Elsevier, vol. 44(C), pages 267-280.
    10. Ajim Uddin & Mohammad Ashraful Ferdous Chowdhury & Md. Nazrul Islam, 2017. "Determinants Of Financial Inclusion In Bangladesh: Dynamic Gmm & Quantile Regression Approach," Journal of Developing Areas, Tennessee State University, College of Business, vol. 51(2), pages 221-237, April-Jun.
    11. Ximena Pena & Carmen Hoyo & David Tuesta, 2014. "Determinants of financial inclusion in Mexico based on the 2012 National Financial Inclusion Survey (ENIF)," Working Papers 1415, BBVA Bank, Economic Research Department.
    12. World Bank, 2015. "Paraguay Diagnostic Review of Consumer Protection and Financial Literacy : Volume 1. Key Findings and Recommendations [Paraguay, estudio de diagnóstico de protección del consumidor y educación fina," World Bank Publications - Reports 21486, The World Bank Group.
    13. World Bank, 2015. "Paraguay Diagnostic Review of Consumer Protection and Financial Literacy : Volume 2. Comparison with Good Practices [Paraguay, estudio de diagnóstico de protección del consumidor y educación financ," World Bank Publications - Reports 21487, The World Bank Group.
    14. World Bank Group, 2015. "Zimbabwe Diagnostic Review of Consumer Protection and Financial Literacy," World Bank Publications - Reports 25874, The World Bank Group.
    15. Richard Duncombe & Richard Boateng, 2009. "Mobile Phones and Financial Services in Developing Countries: a review of concepts, methods, issues, evidence and future research directions," Third World Quarterly, Taylor & Francis Journals, vol. 30(7), pages 1237-1258.
    16. David Tuesta & Gloria Sorensen & Adriana Haring & Noelia Camara, 2015. "Financial inclusion and its determinants: the case of Argentina," Working Papers 1503, BBVA Bank, Economic Research Department.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Evans, Olaniyi, 2016. "Determinants of Financial Inclusion in Africa: A Dynamic Panel Data Approach," MPRA Paper 81326, University Library of Munich, Germany.
    2. Thanh Tam Le & Nguyen Dieu Linh Dang & Thi Dieu Thu Nguyen & Thanh Son Vu & Manh Dung Tran, 2019. "Determinants of Financial Inclusion: Comparative Study of Asian Countries," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 9(10), pages 1107-1123, October.
    3. Fareeha Adil & Abdul Jalil, 2020. "Determining the Financial Inclusion Output of Banking Sector of Pakistan—Supply-Side Analysis," Economies, MDPI, vol. 8(2), pages 1-20, May.
    4. Evans, Olaniyi, 2015. "The Effects of Economic and Financial Development on Financial Inclusion in Africa," MPRA Paper 81325, University Library of Munich, Germany.
    5. Idrees Liaqat & Yongqiang Gao & Faheem Ur Rehman & Zoltán Lakner & Judit Oláh, 2022. "National Culture and Financial Inclusion: Evidence from Belt and Road Economies," Sustainability, MDPI, vol. 14(6), pages 1-21, March.
    6. Kanittha Tambunlertchai, 2018. "Determinants And Barriers To Financial Inclusion In Myanmar: What Determines Access To Financial Services And What Hinders It?," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 63(01), pages 9-26, March.
    7. Dai-Won Kim & Jung-Suk Yu & M. Kabir Hassan, 2018. "The Influence Of Religion And Social Inequality On Financial Inclusion," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 65(01), pages 193-216, July.
    8. Mohamed Noureldin Sayed & Amir Shusha, 2019. "Determinants of Financial Inclusion in Egypt," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 9(12), pages 1383-1404, December.
    9. Amit Pandey & Ravi Kiran & Rakesh Kumar Sharma, 2023. "Investigating the Determinants of Financial Inclusion in BRICS Economies: Panel Data Analysis Using Fixed-Effect and Cross-Section Random Effect," Sustainability, MDPI, vol. 15(2), pages 1-21, January.
    10. Thereza Balliester Reis, 2021. "What is financial inclusion? A critical review," Working Papers 246, Department of Economics, SOAS University of London, UK.
    11. Josephat Lotto, 2018. "Examination of the Status of Financial Inclusion and Its Determinants in Tanzania," Sustainability, MDPI, vol. 10(8), pages 1-15, August.
    12. Alfonso Siano & Lukman Raimi & Maria Palazzo & Mirela Clementina Panait, 2020. "Mobile Banking: An Innovative Solution for Increasing Financial Inclusion in Sub-Saharan African Countries: Evidence from Nigeria," Sustainability, MDPI, vol. 12(23), pages 1-24, December.
    13. Christelis, Dimitris & Dobrescu, Loretti I. & Motta, Alberto, 2020. "Early life conditions and financial risk-taking in older age," The Journal of the Economics of Ageing, Elsevier, vol. 17(C).
    14. Tullio Jappelli, 2010. "Economic Literacy: An International Comparison," Economic Journal, Royal Economic Society, vol. 120(548), pages 429-451, November.
    15. Burke, Matt & Fry, John, 2019. "How easy is it to understand consumer finance?," Economics Letters, Elsevier, vol. 177(C), pages 1-4.
    16. Justin Falk & Nadia Karamcheva, 2019. "The Effect of the Employer Match and Defaults on Federal Workers’ Savings Behavior in the Thrift Savings Plan: Working Paper 2019-06," Working Papers 55447, Congressional Budget Office.
    17. Michael King, 2012. "The Unbanked Four-Fifths: Informality and Barriers to Financial Services in Nigeria," The Institute for International Integration Studies Discussion Paper Series iiisdp411, IIIS.
    18. Annamaria Lusardi & Olivia S. Mitchell, 2008. "Planning and Financial Literacy: How Do Women Fare?," American Economic Review, American Economic Association, vol. 98(2), pages 413-417, May.
    19. Alisdair McKay, 2011. "Household Saving Behavior and Social Security Privatization," Boston University - Department of Economics - Working Papers Series WP2011-027, Boston University - Department of Economics.
    20. Mitchell, O.S. & Piggott, J., 2016. "Workplace-Linked Pensions for an Aging Demographic," Handbook of the Economics of Population Aging, in: Piggott, John & Woodland, Alan (ed.), Handbook of the Economics of Population Aging, edition 1, volume 1, chapter 0, pages 865-904, Elsevier.

    More about this item

    Keywords

    Financial Inclusion; Financial Discourse; Financial System;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • F30 - International Economics - - International Finance - - - General
    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eco:journ1:2018-03-1. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Ilhan Ozturk (email available below). General contact details of provider: http://www.econjournals.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.